High utilisation of the abattoir's capacity is essential to a successful transformation of Danish Crown. Therefore, the board has agreed on several new initiatives to make it more attractive to deliver pigs to the company's abattoirs.
"The new initiatives aim to increase the supply of pigs in both the short and long term. In the short term, more pigs will mean that we can maintain our level of efficiency, and consequently our earnings. In the long term, it is crucial for Danish Crown to have a stable supply of raw materials – it is key to healthy operations and the benefit of our owners and customers," says Niels Duedahl, Group CEO of Danish Crown, and continues:
"We have been transparent about our need for support from the farmers - if we are to ensure Danish pork production in the long run. With the five initiatives, we are trying to make it more attractive for both new and existing suppliers to support Danish Crown."
The new initiatives are primarily financial incentives for farmers who either establish or expand their production. Additionally, it will become easier for non-members to deliver some of their pigs to Danish Crown for an agreed period.
The five new initiatives:
Heavy Pig Contract
Danish Crown offers both new and existing members the opportunity to sign a heavy pig contract (delivery of pigs with a slaughter weight of 95.0 kg – 114.9 kg). The heavy pig contracts should contribute more kilos. The condition for the contract is that the number of stables for slaughter pigs is increased, so the A-quantity remains at least unchanged.
Growth Allowance
Danish Crown offers a growth allowance of 40 øre/kg, valid for the fiscal year 2025/26. It replaces the current growth allowance 2 from the fiscal year 2024/25. The growth allowance is given to current members who increase their A-quantity after 1 March 2025, and to new members.
Contract Pigs
Danish Crown gives non-members the opportunity to deliver some of their pigs as contract pigs (trial load scheme) to Danish Crown for a period of up to 12 months. The delivery agreement does not entail ownership rights.
Subsidy for Renting Barns
Danish Crown launches a new subsidy, which can be given to both new and
existing members if they rent an empty barn. The subsidy amounts to 35 DKK per pig delivered and is granted from 1 March 2025 to 30 September 2027 for a rental agreement for all or part of the period.
Coverage Contribution Guarantee for New Younger Owners
Danish Crown introduces a subsidy for renting a slaughter pig barn through a coverage contribution guarantee for new members under 40 years old. The coverage contribution guarantee applies up to a coverage contribution of 140 DKK/pig, with a maximum payment of 100 DKK/pig.
In addition to the new initiatives, further measures are being worked on concurrently to help ensure stable supplies in the long term.
"We are undergoing a transformation of the company, and the most important metric for us is that we regain our competitiveness in pricing. We must once again be the abattoir that pays the best price in Denmark, just as our owners rightly expect from us. We have already pulled several major levers internally in the company, but to continue the development, it is essential that we stand on a stable supply of raw materials," says Niels Duedahl.
Agreements on the new initiatives can be made starting today, and Danish Crown Owner Service is ready to assist both existing members and other interested parties with more information about the initiatives.